\u3000\u3000 China National Nuclear Power Co.Ltd(601985) (601985)
“Nuclear power + new energy” goes hand in hand, driven by dual nuclear power. In 2021, Fuqing No. 5 and Tianwan No. 6 units were put into operation. In January 2022, Fuqing No. 6 was successfully connected to the grid. So far, the company has 25 nuclear power units in operation and the installed capacity in operation has reached 23.71 million KW. By the end of 2021, the installed capacity of the company has reached 2634700 kW and 6238600 kW respectively, accounting for 28.24%, an increase of nearly 8 percentage points over the end of 2020.
In 2025, the cumulative installed capacity of Fengguang will be nearly 30 million KW, and the company’s cash flow will be sufficient and stable to support the new energy development goal of the 14th five year plan. The company’s total installed capacity target is 56 million kW in 2025. According to the operation time of the company’s nuclear power under construction, it is expected that the installed capacity of the company’s nuclear power will reach 26.134 million kW in 2025. Based on this, it is estimated that the installed capacity of the company’s new energy will reach nearly 30 million kW in 2025, the annual average installed capacity of new energy will increase by 5.25 million KW from 2022 to 2025, and the CAGR will be as high as 35.5%. In addition, the market-oriented transaction electricity prices in Jiangsu and other places have risen, while green power and nuclear power itself have no pressure of rising costs. With the increasing proportion of market-oriented transaction electricity, the company is expected to benefit significantly.
Elimination of technical and policy risks of nuclear power. The normalization approval of nuclear power for three consecutive years marks the elimination of policy risks in nuclear power development. During the “14th five year plan” period, 6-8 new nuclear power units will be approved every year, and the certainty and growth of nuclear power development in the next 15 years will be guaranteed. The technical route of nuclear power is clear. As the mainstream route of the third generation nuclear power technology, Hualong 1 is currently in operation and under construction. With the progress of technology and the maturity of construction, the cost of Hualong 1 is expected to be further explored during the 14th Five Year Plan period. The operation license of Qinshan nuclear power plant unit 1 is allowed to continue for 20 years, which is expected to increase the company’s performance.
Profit forecast. The company’s main business of nuclear power is stable, and nuclear power will usher in stable growth after the elimination of technical and policy risks. The main business of nuclear power brings abundant and stable cash flow, which is enough to support the rapid growth of scenery. During the “14th five year plan” period, the growth of the company’s installed capacity mainly depends on wind power and photovoltaic. We expect the company to achieve revenue of 63.11/73.86/76.45 billion yuan in 2021 / 2022 / 2023, net profit attributable to parent company of 8.449/112.7/12.056 billion yuan, EPS of 0.48/0.64/0.69 yuan and corresponding PE of 15.1/11.32/10.58 yuan. Considering the steady increase of the company’s nuclear power and new energy installed capacity, the rise of market-oriented transaction electricity price and the increase of nuclear power utilization hours, the company is given 15-18 times PE in 2022, with the corresponding share price of 9.6-11.52 yuan, maintaining the “recommended” rating of the company.
Risk warning: due to nuclear power safety accidents, the installed capacity of Fengguang is less than expected.
